Rick Pitino set for battle with Louisville over contract, potential termination

University of Louisville Interim President Dr. Greg Postel holds a news conference.

The University of Louisville’s decisions Wednesday to place men’s basketball coach Rick Pitino and athletics director Tom Jurich on administrative leave sets up an array of potential scenarios relating to their futures with the school and the consequences of their potential permanent departures.

Firing Pitino without cause could cost the university more than $40 million. Firing him for cause could trigger a legal battle.

Firing Jurich without cause would be much less costly than getting rid of Pitino. Firing Jurich for cause could result in him nevertheless getting paid more than $260,000, and could still leave the school and an affiliated foundation with a fight.

University President Gregory Postel announced the school’s moves one day after Louisville’s program was implicated in a federal complaint that alleged corruption among college basketball coaches, financial advisers, agents shoe-and-apparel companies and others relating to players’ college recruitment and choices of post-college representation.

Postel said Pitino has been put on “unpaid administrative leave” and his employment “will be reviewed at a later date.” Pitino had been scheduled to make $4.3 million in basic pay this year from the school, which has him under contract through June 30, 2026. In addition, the school has allowed him to also have a separate personal services contract with the school’s shoe-and-apparel outfitter, Adidas. Pitino’s deal with Adidas likely pays him well over $1 million a year, based on an athletically related outside-income disclosure that he signed in 2016

Jurich has been put on “paid administrative leave,” Postel said, and “the leave will continue until the board of trustees has an opportunity to evaluate his continued employment.”

Meanwhile, Postel said, the university will be appointing an interim men’s basketball coach, as well as an interim athletics director.

However, Postel also emphasized that neither Pitino nor Jurich has been fired — at least not yet.

“An administrative leave is an administrative leave,” Postel said. “It is not a dismissal from a permanent position. … That is one of the possible outcomes.”

Duke University law professor Paul Haagen and Tulane University Sports Law Program director Gabe Feldman said this approach buys the school some time. “It provides a measure of distance and insulation” from Pitino and Jurich “until (school officials) decide what they want to do,” Haagen said.

It gives the school “more of an opportunity to try to determine what actually happened,” Feldman said.

Unless settlements are reached, if the school wants to fire Pitino or Jurich or both, it will have to decide whether to terminate for cause or without cause. Those paths have dramatically different implications.

In Pitino’s case, one aspect is clear: As provided to USA TODAY Sports in February in response to an open-records request, the agreement has no language pertaining to a termination without cause by the school or by Pitino. That means if the school fired Pitino without cause, it would owe him all of the money remaining on the deal — roughly $44.4 million. Pitino’s contract, specifically, is with the University of Louisville Athletic Association (ULAA), a non-profit organization affiliated with the university but not actually a part of the university.

Pitino’s contract does address the possibility of termination for cause, and if that occurs, he is due to be paid only through the end of the month in which termination occurs. Actions that can trigger a termination for cause include:

►A “material violation” of the contract, which holds him responsible for the actions of all of his assistant coaches and staff.

►“Disparaging media publicity of a material nature that damages the good name and reputation of Employer or the University, if such publicity is caused by Employee’s willful misconduct that could objectively be anticipated to bring Employee into public disrepute or scandal, or which tends to greatly offend the public, or any class thereof…”

If Pitino is to be fired for cause, the contract says, the termination can occur only after he has been given 10 days’ “prior written notice of the charges” against him “and an opportunity for (him) to present evidence.” Pitino is allowed to have the assistance of a lawyer, at his expense, “to aid in the proceeding,” the details of which are not described by the contract.

Jurich’s circumstances are more complicated. He is employed under two separate contracts. One agreement is with the university, but with terms approved by the board of directors of the ULAA, which is responsible for all financial obligations from non-state funds. That agreement runs through July 26, 2023.

The other agreement is with the University of Louisville Foundation, whose website describes it as an “independent … not for profit corporation that holds, invests and designates funds of the University”; it also engages in fundraising. Jurich’s deal with the foundation states that it runs concurrent with the university agreement. USA TODAY Sports obtained copies of both agreements late this summer.

Jurich’s contract with the foundation, as amended by a memo from then-foundation and university president James Ramsey in September 2011, states that if Jurich is fired by the university for cause, he will get a payment “equal to your actual total compensation excluding retention payments paid in the 12 month fiscal year ending prior to the year of termination.”

Louisville athletic director Tom Jurich.

Jurich was paid $263,595 by the foundation during a fiscal year ending June 30, 2016, according to a special forensic audit done at the university’s request in 2016 and released in June 2017.

If Jurich is notified that his university contract is being terminated for cause, he must given the opportunity to “cure … such violation” that triggered the termination notice within 30 days. “If cure appears impossible to complete within 30 days,” Jurich “shall, at minimum, commence and diligently pursue any attempts to cure” within 30 days.

Termination for cause would end his compensation from the university. According to the special audit, he received just over $1 million in base salary in fiscal 2016. But he also is eligible for an array of benefits, including more than $300,000 a year related to savings/deferred compensation on plans. His foundation contract guarantees him another $300,000 in bonus money, less the amount of performance bonuses he achieves under his university contract.

Jurich’s university contract stated that if is terminated without cause, he would be entitled to his base salary through June 30, 2016, plus $150,000 a year of the contributions to the savings/deferred compensation plans.

If Jurich’s foundation contract is terminated without cause, he is owed his base salary for the remainder of the contract period — more than $1.5 million.